Near Death Experince as Catalyst for (Great) Change

Christine Flanagan
January 9, 2009

(Image: M.C. Escher, Sky and Water I, 1938) Earlier this week, BIF chief catalyst Saul Kaplan called for the creation of a "passion economy" to unleash both a new era of prosperity and solutions for the big issues of our time. How many times since President Kennedy rallied the collective passion of our nation to send a man safely to the moon, have you heard someone say, 'Where is our moon mission?' he asked:

"We need to move from a knowledge-based economy to a passion-based economy. Who gets excited about a knowledge-based economy? Where is the passion? I have spent a ton of time and effort to rally the troops. If I am honest, people just haven’t connected emotionally. The knowledge-based economy has given us the tools we need but has fallen short in solving the real issues of our time...Systems level innovation requires passionate leaders and organizations that are committed to a cause. Passion-based organizations stop at nothing to accomplish their goals and are able to attract people and resources to their causes." (Saul Kaplan, Creating a Passion Economy, January 5, 2009)

Building on this theme, BIF advisor Bill Taylor writes in his blog about the need for leaders to summon their "animal spirits" - a phrase coined by influential economist, John Maynard Keynes, in the depths of the Great Depression:

"If all you've got is a spreadsheet filled with red ink and grim forecasts, it's easy to be paralyzed by fear. But if you've got some leadership nerve, if you can summon those "animal spirits" of which Keynes writes, then hard times can be a great time to separate yourself from the pack and build advantages for years to come." (Bill Taylor, A Manifesto for Leaders: Time to Summon Your "Animal Spirits" January 8, 2009)

Both posts brought me back to the BIF-3 Summit and Irving Wladawsky-Berger's phenomenal onstage conversation with Walt Mossberg. Irving was questioned whether any company can truly reinvent itself without having a near-death experience. Irving said no, suggesting that IBM's near-death experience was an essential part of their successful transformation.

"Must a successful organizational re-invention be preceded by the kind of cataclysmic events that open up the mind to new experiences - essentially cleaning the brain from its previous inflexible views of life? The ancient Greeks certainly thought so, as reflected in their tragedies," he later wrote on his blog.

So many companies are on the edge of the abyss right now. I think Saul and Bill are both right in that psychology will be the driving force for who makes it out the other end and who fades away.

Recently, I've become a big fan of economist Joe Stiglitz's point-of-view with this notable quote from a recent New York Times article:

"Bailouts…are aimed at correcting the mistakes of the past, so they are backward-looking. We would be much better off spending our money forward-looking. If we spend $700 billion on new technology and innovation, we’d have a stronger, new, real economy. Up to now, the discussion has focused on the sectors that have been mismanaged rather than the sectors that are creating our future." Innovation Should Mean More Jobs, Not Less, New York Times, January 3, 2009

I believe this strategy will ultimately lead to the much-needed systems level innovations required to pull us out of the mess we're in. That said, I'll also add that if we are going to make progress on the big issues of our time including health care, education, energy independence, public safety, and quality of life we will have to enable collaborative innovation. All of these issues are systems problems that will only be solved with systems solutions. (As an aside, I’ll add that what we really need to do is create safe and manageable platforms to experiment with systems level innovation - but that’s a conversation better suited for another post.)

Finally, at the risk of sounding morbid, there's a delicate balance between fixing what's wrong and cutting and running. Like people, business units have a life cycle. But important components can be saved to not only live another day but also evolve into the next big thing. (BIF research advisor Clay Christensen once told me to think of it like biological evolution: The population will evolve, even though individuals can't.)

All this gets back though to the one intractable issue facing near-death companies today and that's mindset. All the scientific arguments in the world can't change an entrenched culture. It's like telling a terminal cancer patient to just give up and accept the inevitable. And that just won't do.

There are no easy answers, which is why here at the Business Innovation Factory, we wholeheartedly embrace an experimentation model that involves all parts of the business model.

BIF Related Content

• Read Saul's blog post Creating a Passion Economy
• Watch Irving Wladawsky-Berger talk about IBM's near-death experience at BIF-3

External Content

• Read Bill Taylor's post A Manifesto for Leaders: Time to Summon Your "Animal Spirits" January 8, 2009
• Read Innovation Should Mean More Jobs, Not Less, New York Times, January 3, 2009